Sie sind auf Seite 1von 35

February 2005

This sample business plan has been made available to users of Business Plan Pro, business planning
software published by Palo Alto Software, Inc. Names, loc ations and numbers may have been
changed, and substantial portions of the original plan text may have been omitted to preserve
confidentiality and proprietary information.
You are welcome to use this plan as a starting point to create your own, but you do not have
permission to resell, reproduce, publish, distribute or even c opy this plan as it exists here.
Requests for reprints, ac ademic use, and other dissemination of this sample plan should be emailed
to the marketing department of Palo Alto Software at marketing@paloalto.com. For product
information visit our Website: www.paloalto.com or call: 1-800-229-7526.

Copyright Palo Alto Software, Inc., 1995-2007 All rights reserved.

Confidentiality Agreement
The undersigned reader ac knowledges that the information provided by _______________ in this
business plan is confidential; therefore, reader agrees not to disc lose it without the express written
permission of _______________.
It is ac knowledged by reader that information to be furnished in this business plan is in all respec ts
confidential in nature, other than information which is in the public domain through other means and
that any disc losure or use of same by reader, may cause serious harm or damage to
_______________.
Upon request, this document is to be immediately returned to _______________.
___________________
Signature
___________________
Name (typed or printed)
___________________
Date
This is a business plan. It does not imply an offering of securities.

Table of Contents
1.0 Executive Summary.............................................................................................................................1
1.1 Objectives ...................................................................................................................................1
1.2 Mission........................................................................................................................................2
1.3 Keys to Success ........................................................................................................................2
2.0 Company Summary.............................................................................................................................2
2.1 Company Ownership .................................................................................................................3
2.2 Start-up Summary ......................................................................................................................3
3.0 Services................................................................................................................................................6
4.0 Market Analysis Summary..................................................................................................................7
4.1 Market Segmentation ................................................................................................................8
4.2 Target Market Segment Strategy.............................................................................................9
4.3 Service Business Analysis .....................................................................................................10
4.3.1 Competition and Buying Patterns .......................................................................................10
5.0 Strategy and Implementation Summary..........................................................................................11
5.1 Competitive Edge....................................................................................................................11
5.2 Marketing Strategy ..................................................................................................................11
5.3 Sales Strategy..........................................................................................................................12
5.3.1 Sales Forecast .....................................................................................................................12
5.4 Milestones ................................................................................................................................15
6.0 Management Summary ....................................................................................................................17
6.1 Personnel Plan.........................................................................................................................17
7.0 Financial Plan ....................................................................................................................................18
7.1 Important Assumptions............................................................................................................18
7.2 Break-even Analysis................................................................................................................18
7.3 Projected Profit and Loss .......................................................................................................19
7.4 Projected Cash Flow ...............................................................................................................22
7.5 Business Ratios .......................................................................................................................24
7.6 Projected Balance Sheet ........................................................................................................26

Page 1

PC Repair
1.0 Executive Summary
PC Repair will provide computer and technical consulting (repairs, training, networking and
upgrade service) to loc al small businesses as well as home PC users. The company will foc us on
marketing, responsiveness, quality, and creating and retaining customer relations.
PC Repair was initially formed as a sole proprietorship, but was rec onfigured as an S Corporation
in Dec ember of 2004. PC Repair will at first be a home office start-up, utilizing one studio room in
the owner's home and serving customers in the loc al Ramsford-on-Bitstream area. In the third
month of our plan, we will move into a leased office space and hire a second tec hnician. As sales
increase, we will hire additional personnel.
The Market
The very nature of the computing industry, with its extraordinary rate of tec hnological
development, creates a constant need for businesses skilled in updating and advising customers
on computer-related issues. In town, the majority of potential customers are dissatisfied with
existing options, creating an attrac tive niche for an innovative start-up. Small business PC users
will provide the majority of our business revenue. Business Week expec ts the computing industry
to grow at a rate of 12% and the proc essor speeds to continue to expand for years to come,
providing a rich resource for sales.
PC Repair has dec ided to foc us mainly on the small business market, as these customers typically
don't have a full-time IT person, but have full-time IT needs. PC Repair will offer an affordable,
on-demand service for these customers. We can also offer maintenance agreements that
generate additional monthly income. For our residential customers, we will offer a very affordable
and helpful service with a very flexible sc hedule to meet their needs. Our target market will foc us
on Ramsford-on-Bitstream and the surrounding areas. Market research indicates there is an
abundance of business for a small company such as PC Repair.
Start-up Funding and Financials
To get PC Repair started the owner is providing cash and assets. We are also seeking a shortterm loan, to be secured with the owner's home equity, and repaid within three years. Our
conservative sales forec asts, based on industry research within the loc al area, projec t hefty
sales in year one, steadily increasing through year three. To reach these goals, we will use an
aggressive advertising campaign to exploit our competitors' weaknesses. With good cost control,
we will see a modest, yet comfortable, net profit the first year, even after moving into a leased
space and hiring additional tec hnicians.

1.1 Objectives
1.
2.
3.
4.

To provide the best service available to the community at an affordable price.


To generate substantial market share so that PC Repair is a common name.
Constant growth in sales from start up through year three.
To generate customer satisfac tion so that at least 40% of our customer base is repeat
business.

Page 1

PC Repair

1.2 Mission
Our goal is to set the standard for on-site computer solutions through fast, on-site service and
response. Our customers will always rec eive one-on-one personal attention at a very affordable
price. Our customers will rec eive the highest quality of customer service available. Our
employees will rec eive extensive training, a great plac e to work, fair pay and benefits, and
incentives to use their own good judgement to solve customers' problems.

1.3 Keys to Success

Establishing a brand identity and generating brand rec ognition through marketing.
Responsiveness: being an on-call computer paramedic with fast response time.
Quality: getting the job done right the first time, offering 100% guarantee.
Relationships: developing loyal repeat customers--retainers.

2.0 Company Summary


PC Repair is an S Corporation loc ated in Ramsford-on-Bitstream, owned by Jack Hac ker. With a
small 3-year loan, PC Repair will grow in one year from a one-man, home-office based repair shop
to a profitable, 3-person business in a leased loc ation. We will build the necessary infrastructure
to quickly and efficiently respond to customers' computer needs, guaranteeing speedy, friendly,
competent, and cost-effective technical support.

Page 2

PC Repair
2.1 Company Ownership
PC Repair was initially envisioned as a sole proprietorship in the owner's home. However, rec ent
feedback from our marketing outreach has suggested a much higher sales potential than
originally imagined, and PC Repair has been reformed as an S Corporation. This change will
provide additional legal protec tion for the owner, and will also streamline the financial operations
of the company as we expand the personnel to 5 within the next three years, lease a separate
space for offices, and purchase company vehicles and cell phones.
The owner, Jack Hac ker, has 10 years of experience in the fields of tec hnical support,
networking, and computer training and repair. Jack has also spent the last three years as the
manager of a custom computer building and repair store, and understands the computer needs of
small businesses.

2.2 Start-up Summary


Total start-up expenses include initial expenses for establishing our website, setting up the
business, and doing our pre-opening advertising. Exac t alloc ations are shown in the table.
The bulk of our start-up requirements are asset needs: we need diagnostic and repair
equipment, half of which will be contributed to the business by the owner from his own materials.
We are treating this equipment as assets bec ause we expec t it to last at least three years, and
to have some resale value when we are through with it; we will buy additional expensed
equipment in years two and three. We also need start-up inventory which includes RAM, spare
hard drives, cables, and cases. Although we will keep expenses to a minimum for the first three
months, before we move, we will also need cash at start-up, to see us through the next several
months with a positive cash balance.
We plan to fund our total start-up requirements direc t owner investment (including the
contributed assets), and a three-year loan sec ured with the owner's collateral (his home equity).
We should be able to easily repay this loan within three years, even with a much lower sales
revenue than projec ted. (See the Cash Flow table for projec ted repayment.)

Page 3

PC Repair
Table: Start-up
Start-up
Requirements
Start-up Expenses
Legal
Website
Business Cards
Insurance
Uniforms
CPA
Advertisement
Total Start-up Expenses

$650
$350
$100
$150
$300
$275
$1,200
$3,025

Start-up Assets
Cash Required
Start-up Inventory
Other Current Assets
Long-term Assets
Total Assets

$28,000
$1,200
$10,000
$0
$39,200

Total Requirements

$42,225

Page 4

PC Repair
Table: Start-up Funding
Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required

$3,025
$39,200
$42,225

Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets

$11,200
$28,000
$0
$28,000
$39,200

Liabilities and Capital


Liabilities
Current Borrowing
Long-term Liabilities
Accounts Payable (Outstanding Bills)
Other Current Liabilities (interest-free)
Total Liabilities

$19,225
$0
$0
$0
$19,225

Capital
Planned Investment
Owner
Investor
Additional Investment Requirement
Total Planned Investment

$23,000
$0
$0
$23,000

Loss at Start-up (Start-up Expenses)


Total Capital

($3,025)
$19,975

Total Capital and Liabilities

$39,200

Total Funding

$42,225

Page 5

PC Repair

3.0 Services
PC Repair will offer computer repairs, training, networking and upgrade service to clients in two
major categories: home PC users and small business users. As PC Repair and the client demands
grow, we will offer software development to our business clients.
From the very first day, we will offer on-site repair and consulting services, so that our clients
don't need to take time out of their busy days to haul a computer in to our workshop. This is the
single biggest frustration Jack has seen among small business owners needing computer help.
Much of our diagnostic equipment is portable, and we will remove a PC to our workshop only
when the problem requires more detailed diagnosis or repair. We will also offer free pick-up and
delivery of PCs needing repair. To meet the growing demand for this service, we will purchase a
company vehicle in the third month.
We will also offer extended maintenance contrac ts, so that business clients can deal with
technical support and repair needs as a single line-item expense, rather than having to plan for
unexpec ted crashes and problems with a rainy-day fund they may never use. Maintenance
contrac ts yield a high gross margin for us, and provide peace of mind for the customer.
We will offer limited software support (installation and compatibility issues), and foc us on
hardware and networking support - this is a vital distinction, since software is evolving much
more rapidly than hardware, and our clients will have such diverse software needs that we
couldn't possibly keep up with all of them. We will encourage clients to register their software
and use the software's own support options to their full potential. We will, however, keep up to
date with multiple operating systems and networking developments, working with c lients to make
sure they have the most appropriate combinations of hardware, OS, networking, bac kup
systems, and software. Bac kup and security are bec oming higher priorities for all our potential
customers, as internet usage (and its pitfalls) bec omes more common, and as more and more
daily rec ords are stored elec tronically.
Page 6

PC Repair
4.0 Market Analysis Summary
PC Repair will provide computer support in both a consulting and tec hnical capacity to small
business owners as well as home PC users. Since PC Repair is currently a one man operation, its
growth in the first three months will be limited by the owner's capacity to complete work.
However, these first three months are critical for establishing our credibility and a reputation for
getting the job done quickly and well. We will foc us on delivering excellent service, and using the
good word of mouth from this initial period to network with other potential clients.
Personal market research by the owner indicates an attrac tive market niche for our services, of
which PC Repair will take full advantage. The very nature of the computing industry, with its
extraordinary rate of technological development, creates a constant need for businesses skilled
in updating and advising customers on computer-related issues.
National chains, such as "Geeks on Call," and Best Buy's "Geek Squad" have seen rapid growth in
demand for these services in the last few years. Customers are seeking skilled help with
everything from installation of software and hardware components, to networking, to transferring
files from an old computer to a new one. Those who can often enlist their tec h-savvy children's
help, but others are not so fortunate, and small-business owners need reliable and quick help
with all their computer needs, since every hour down may mean an hour or more of lost revenue,
espec ially for any business with a website or those doing e-commerce.

Page 7

PC Repair
4.1 Market Segmentation
The existing computer service market is so extensive that categorizing it is rather difficult. We
have broken our potential market down into two groups, based on their needs: home PC users
and small business clients.
Home PC User
Our home PC user market includes non-tech-savvy residents of the loc al area (15 mile radius),
generally between the ages of 30 and 70, with at least one home computer. We are not
expec ting income from users below 30, who tend to be more comfortable with technology and
willing to attempt repairs and upgrades on their own, without seeking professional assistance.
Such home users generally own a computer to do email, play games, write letters, sc an and print
photos, and oc casionally to do bookkeeping or taxes. Home PC users with more sophisticated
applications generally have enough tech savvy, from tec h experience at work, to do their own
repairs and upgrades. Their hardware needs will include the computer itself, monitors, keyboards,
mouse, printer, and sc anner.
This group is growing slightly faster than the overall population growth in our area, in part due to
the increasing demand for computers among retired people and young families, about 7% a year.
Small Business Users
Small business users will provide the majority of our business revenue. The small business market
will be defined as customers within a 15 mile radius, with 2 or more computers or a network
which they use for business purposes at least 25% of the time. Their business use may include
minor usage, such as updating a business website for a brick-and-mortar store, keeping the
books, designing graphics or ad campaigns, and writing copy for press releases. It may also be
more extensive, incorporating inventory trac king, POS systems, customer databases, online
product/service delivery, or product development. The more intensive their computer usage for
business, the more critical it is to them that their tec hnology work well and reliably, and that
quality repairs and support are available in a crisis. Their hardware needs will include the same
items as home users, plus servers, bac kup systems, data storage, and wireless networking.
The portion of the small business market we are targeting is growing at around 2% a year.

Table: Market Analysis


Market Analysis
2005
Potential Customers
Home PC Users
Small Business Users
Other
Total

Growth
7%
2%
0%
5.39%

2006
25,000
10,000
0
35,000

2007
26,750
10,100
0
36,850

2008
28,623
10,201
0
38,824

2009
30,626
10,303
0
40,929

32,770
10,406
0
43,176

CAGR
7.00%
1.00%
0.00%
5.39%

Page 8

PC Repair

4.2 Target Market Segment Strategy


Although there are more potential customers among home PC users, we expec t the majority of
our revenue to come from small business clients, since their need for our services is more urgent,
and they are willing to invest in technology as part of their business plan. The majority of our
marketing efforts will thus be foc used on small business owners. These customers typically don't
have a full-time IT person, but have full-time IT needs. Home PCs are often used by multiple
people, and serve multiple purposes. Our home PC users need help with managing their settings
to integrate the different needs of all household members as much as they need technical
assistance.
ComputingNet magazine rec ently reported on the substantial need for timely and cost-effective
computer upgrades and repairs in this region; Jack Hac ker has seen this market need in person,
as frustrated clients waited for days or weeks for their critical components to be returned to full
capacity, with no inexpensive alternative to the existing computer repair shops. All of our clients
need technical assistance, but we are also selling peace of mind: our clients will know that
friendly, efficient help is just a phone call away. As more and more companies switch their
support services to automated call centers or touch-tone menus, the simple reassurance of
hearing another human voice on the phone within a few rings is immeasurable. Even better is
knowing that within a few hours, someone will show up and take care of their problem.
Both the software and hardware side of the computer industry continue to turn out new and
revised computer components at alarming rates. For PC Repair this means job security well into
the future. As reported by the Wall Street Journal, there seems to be no end to the development
of the computer market. Business Week expec ts the computing industry to grow at a rate of
12% and the proc essor speeds to continue to expand for years to come.

Page 9

PC Repair
4.3 Service Business Analysis
Secondary market research shows computer service customers tend to be very loyal to providers
that do good work and satisfy their needs. An analysis of PC Repair's main c ompetitors shows no
overwhelming strengths that would be significant barriers to entry into the market, as our loc al
competitors have serious weaknesses.
The computer maintenance and repair industry is fragmented, with a few large, national players
and hundreds of small, loc al stores. While most computers are ac tually repaired in-store, near
the customer, parts for the repair come from major manufac turers and distributors; delays in
rec eiving necessary parts can significantly slow down the repair proc ess. Large chains have
solved this problem by keeping vast amounts of inventory in stoc k at all times, while loc al stores
offer customers the trade-off of personal interac tion and trust that may make up for some delay.
PC Repair has established a relationship with a loc al distributor to do rapid special-ordering;
although this capability is more expensive than normal channels, it will enable us to quickly
establish a reputation as efficient and responsive to customer needs, particularly for our small
business users. We will leverage this customer loyalty into great word of mouth marketing and
steady growth.

4.3.1 Competition and Buying Patterns


Customers choose computer repair and assistance services based on reputation, previous
experience, and price. They may choose to return to a medioc re provider with whom they're
familiar, rather than try out a new unknown company about whom they've heard nothing. Large
stores, espec ially the service departments of national chains, have a great advantage simply in
their affiliation with an established brand. Establishing our brand identity and a great reputation
in the first few months is critical to our success. Once we have broken in to the loc al market,
our great service will turn new clients into permanent clients.
Our services will be second to no one and our prices will be very reasonable for the high quality
service we offer. By providing superior service, word of mouth alone will bring in many new
clients. The satisfac tion our consumers find will keep them coming bac k. There are two main
competitors for the computer upgrade and repair business in this area:
1. Competitor A. They are a well established provider of computer upgrades and services, and
do quick work. However, they have a high staff turnover, a young and inexperienced staff,
and are more interested in selling new components than in maintaining existing mac hines or
finding custom solutions. They do not offer any kind of pick-up and drop-off service, and do
not offer on-site help. They really only offer hardware support.
2. Competitor B. Smaller and less known then A, B provides many services for residents living
in east and south parts of town. They are more willing to spend time with a client, figuring
out exac tly what his or her needs are, and suggesting new options than c ompetitor A.
However, they have an inefficient ordering system and an unkempt shop, which deters
potential customers and can turn existing customers to the competition. They also do not
offer on-site services, although they are considering instituting a trial pick-up/drop-off
service. They are in the best position to copy our innovations and steal customers, but their
management is complac ent and may not respond to competition.
Both of these companies charge rates in excess of PC Repair; we will be able to attrac t the
price-sensitive market without much work.

Page 10

PC Repair
5.0 Strategy and Implementation Summary
Our Strategy and Implementation turn on three points:
1. A value proposition of timely and prac tical solutions, at a reasonable rate, coupled with a
100% guarantee.
2. Exploiting our competitors weaknesses: a competitive edge based on quick, effective, and
sympathetic customer service, which meets the customer where his needs are, rather than
trying to fit him into an existing box.
3. Quickly establishing a brand identity and developing a great reputation among loc al
customers to generate word of mouth advertising.

5.1 Competitive Edge


Quick response: PC Repair will provide same day and after hours service.
A flat rate policy: This undermines the competition, who charge by the hour. The pricing
has been set to reflec t the average amount of time it takes to perform the task. With this
strategy we can undercut most competitors and gain loc al market power.
On-site and pick-up/drop-off services: This will minimize the time and effort a customer
needs to put into dealing with his computer problem.
Suprisingly, our small size is an advantage: customers will rec ognize me (and future
employees), and will know they will get the same great service every time they call.

5.2 Marketing Strategy


Our marketing strategy will aggressively exploit our competitors' weaknesses. During the start-up
phase, we will run large ads in the business section of the loc al newspaper, asking, "Are you fed
up with poor customer service for your computer needs?" These ads will foc us on our
advantages, including on-site service, competitive rates, and quick response and turn-around
times. They will announce our opening date, and include a coupon for free diagnostic service for
the first 20 customers.
We will follow up on these opening ads with a smaller direc t-marketing campaign to small
business owners, with lists drawn from the loc al Chamber of Commerce. Jack will use his
contac ts with business customers from his years as a manager to create a "buzz" about this new
business.
We will continue periodic advertisements, including several promotions (disc ounts, free diagnosis,
etc.) throughout the first year. We expec t a small but steady response from home PC users who
see our ads elsewhere, but will also run monthly ads in sec tions other than the business one.
We will offer a promotion during the first 90 days of business to generate business traffic and
word of mouth. Our promo is Spyware removal on any desktop PC for $70 including tax and
software. Spyware is a huge problem for a lot of residential and small business customers, and
the offer should draw a lot of interest.

Page 11

PC Repair
5.3 Sales Strategy
Our marketing strategy will generate customer inquiries. We will close the deals by offering an
outstanding service and a very reasonable price. Happy customers generate repeat business and
word of mouth. Our toll free number is operational 24 hours a day, seven days a week, and from
8am to 9pm, I will be available to answer calls. At other times, or when I am on the phone, an
answering service we have hired will catch c allers and give them an estimated wait time for a
call-bac k; this is another step towards delivering a complete solution to our customers.
Sales forec ast figures are based on industry figures for the typical growth of a start-up and
reflec t repeat business generated through meeting customer needs.

5.3.1 Sales Forecast


The sales strategy is a prediction of controllable growth for the first year. PC Repair will foc us on
quality and attention to detail to avoid some potential pitfalls encountered by many new
businesses. The predicted growth is moderate in the home PC market and in the small business
arena. However, with aggressive advertising and word of mouth, this will increase. Our agressive
TV advertising will increase our residential and small business customer base as well as word of
mouth within the first year. Within a few months we will have the need for additional employees
to handle the work load. At that time, we will move into a leased space with additional square
footage, and buy a company vehicle to help with the on-site calls.
Our competitors average 75+ calls a month. Given that our advertising will be aggressive, we
expec t the same results. The sales forec ast is conservative, which gives us a chance to gauge
our experience and adjust the plan ac cordingly.
We will service all of Ramsford-on-Bitstream, and the surrounding area. We expec t that the
majority of our jobs will be performed in the immediate town area. A service technician can
perform an average of 3 jobs per day. Our sales forec ast predictions are less than that. With our
agressive advertising campaign we expec t nominal growth. We predict it will take a few weeks
for the marketing to settle in with c ustomers. However, we are going to offer a promo for our
services which should generate some substantial results.
The one element of sales not represented in the table below is direc t costs for our maintenance
contrac ts. We estimate these costs at 12% of sales revenue, but expec t a delayed oc currence
- that is, we will sell maintenance contrac ts starting in February, but do not expec t to ac tually
perform maintenance on computers guaranteed under them for the first few months. We will
incur more and more costs from these as time goes on, and the computers age - most of the
service in a maintenance contrac t is performed within the last quarter of the specified period.
Projec tions for the direc t costs for these contrac ts can be found in the Profit and Loss Table, as
other costs of sales.

Page 12

PC Repair

Page 13

PC Repair
Table: Sales Forecast
Sales Forecast
FY 2006

FY 2007

FY 2008

Unit Sales
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
Total Unit Sales

166
264
235
32
697

200
300
0
60
560

225
350
0
85
660

Unit Prices
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts

FY 2006
$280.00
$500.00
$50.00
$400.00

FY 2007
$300.00
$600.00
$0.00
$600.00

FY 2008
$300.00
$600.00
$0.00
$600.00

Sales
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
Total Sales

$46,480
$132,000
$11,750
$12,800
$203,030

$60,000
$180,000
$0
$36,000
$276,000

$67,500
$210,000
$0
$51,000
$328,500

Direct Unit Costs


Home PC Unit
Small Business Unit
Promo
Maintenance Contracts

FY 2006
$84.00
$105.00
$4.00
$0.00

FY 2007
$90.00
$126.00
$0.00
$0.00

FY 2008
$90.00
$126.00
$0.00
$0.00

Direct Cost of Sales


Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
Subtotal Direct Cost of Sales

$13,944
$27,720
$940
$0
$42,604

$18,000
$37,800
$0
$0
$55,800

$20,250
$44,100
$0
$0
$64,350

Page 14

PC Repair

5.4 Milestones
Our milestones, listed in the table below, outline the major events that will promote, as well as
insure the success of PC Repair and keep it a going concern well into the future. We will measure
our success in meeting these milestones every month, and adjust the plan to keep up with our
objec tives. Name rec ognition, in particular, is very important to breaking into this market - we
will conduct a survey by calling 200 randomly selec ted small businesses from the Chamber of
Commerce listings on the specified dates and asking them whether they have heard of PC Repair,
and if so, what their impression is of our service. If any of the respondents have ac tually used
our services, we will elicit feedbac k on their experience with us, and suggestions for
improvement. We will also ask if they would rec ommend us to a colleague.

Page 15

PC Repair
Table: Milestones
Milestones
Milestone
Procurement of materials for
opening
Start-up Ad Campaign
Get Loan Approved
Open Business
Name Recognition by 5% of
potential market
Meet with Leasing Agent
Interview potential Techs
Move into Leased Space
Sign on Leased Vehicle
Targeted Ads Begin
1st Tech Starts
2nd Round Tech Interviews
Direct marketing to Small
Businesses
Increase Name Recognition to
20%
2nd Tech Starts
Totals

Start Date
12/1/2004

End Date
2/1/2005

Budget
$1,200

Manager
JMH

Department
Department

12/15/2004
1/1/2005
2/7/2005
2/28/2005

2/6/2005
1/17/2005
2/8/2005
2/28/2005

$1,200
$0
$0
$0

JMH
JMH
JMH
JMH

Department
Department
Department
Department

3/1/2005
3/1/2005
4/1/2005
4/15/2005
4/15/2005
5/1/2005
7/1/2005
7/1/2005

3/10/2005
4/25/2005
4/10/2005
4/20/2005
5/15/2005
5/1/2005
7/31/2005
9/30/2005

$0
$0
$2,000
$6,000
$4,000
$0
$0
$8,000

JMH
JMH
JMH
JMH
JMH
JMH
JMH
JMH

Department
Department
Department
Department
Department
Department
Department
Department

8/1/2005

8/2/2005

$0

JMH

Department

8/1/2005

8/7/2005

$0
$22,400

JMH

Department

Page 16

PC Repair
6.0 Management Summary
PC Repair will be owned and managed by Jack Hac ker. Jack has 10 years of experience in the
fields of technical support, networking, and computer training and repair. Jack has also spent the
last three years as the manager of a custom computer building and repair store, and understands
the computer needs of small businesses. Jack is adept at managing his time, and at quickly
responding to multiple customer calls and needs.
For the first three months, Jack will be in c harge of all aspec ts of the business. In the third
month, when another tech is hired, Jack will shift some of his energy from direc tly responding to
customer needs, to training and managing others to do this work effec tively. Jack will maintain
direc t control over inventory ordering and bookkeeping, and will try to do as many of the on-site
calls as possible himself. Part of our brand rec ognition strategy is to identify PC Repair with
Jack's efficiency, friendliness, and technical expertise. The easiest way to associate the two is
for Jack to be a major part of many customers' experiences with us. He will delegate technical
repairs later in the year to the tec hs working in the leased office space, and will also train them
in his method of direc t phone support.
Jack has worked extensively with c omputer technicians and support staff in the past, and knows
that they work best when given free rein within a set of mutually-agreed-upon guidelines. The
first week of each tech's employment will be dedicated to helping them understand PC Repair's
guidelines:
the customer needs help, and we're here to help them;
the customer is frustrated, upset, or confused - but that doesn't make the customer a
problem;
the customer needs reassurance as well as solutions.
Within this framework, the tec hs can solve the customer's problem the best way they see fit Jack is not a micro manager.

6.1 Personnel Plan


Jack Hac ker will be the only employee for the first few months; his salary is direc tly related to
the success of the business, and will never exceed 18% of sales revenue. In the third month, we
will move to a leased office space and hire a second employee, with a third hire planned for
August, if projec tions are on target. We plan to hire additional part-time employees in the
second year, to better handle the increasing sales.
Our employees will be skilled professionals, with equally strong tec hnical and people skills. It is
very important to Jack that they be paid salaries commensurate with their abilities and
dedication- happy tec h support people make for happy customers. To that end, our full-time
employees will rec eive health benefits (premiums split between the employee and PC Repair),
paid holidays, and sick time. Those benefits are included in the payroll totals listed below.

Page 17

PC Repair
Table: Personnel
Personnel Plan
Owner
Tech1
Tech2
Part Time
Total People

FY 2006
$33,000
$21,600
$14,400
$0
3

FY 2007
$38,000
$30,000
$30,000
$12,000
5

FY 2008
$40,000
$30,000
$30,000
$15,000
5

Total Payroll

$69,000

$110,000

$115,000

7.0 Financial Plan


The following sections include the annual estimates for the standard set of financial tables.
Detailed monthly pro-forma tables are included in the appendix.
Our financial plan calls for limited growth in the first three months, followed by much higher sales
when we move and hire additional employees. These projec tions are based on sound market
research and ratios for comparable businesses. As we grow, we will keep our operating expenses
down, and maintain a positive cash balance as we repay our three-year loan.

7.1 Important Assumptions


PC Repair's customer base would fluctuate if there was a rec ess in the ec onomy or other
extenuating circumstances that pertain direc tly to consumer or industry behavior. However,
given the steady increase in c omputer users despite the rec ent rec ession, we assume that sales
forec asts are unlikely to be dramatically altered by economic events. The table below shows
some of our other assumptions.

Table: General Assumptions


General Assumptions
FY 2006
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other

FY 2007
2

7.00%
10.00%
30.00%
0

FY 2008
3

70.00%
10.00%
30.00%
0

70.00%
10.00%
30.00%
0

7.2 Break-even Analysis


Fixed costs are projec ted at a monthly average for the first year. This includes payroll, moving
expenses and rent, purchase of a company vehicle, and other necessities like cell phones and
the answering service. Variable costs (inventory used in repairing or servicing computers) are
projec ted as well. At these levels, what we need to bring in per month to break even is shown in
the table and chart below. We will reach our break-even point mid-year, although we expec t
sales in November and Dec ember to dip below this level bec ause of holidays.

Page 18

PC Repair

Table: Break-even Analysis


Break-even Analysis
Monthly Units Break-even
Monthly Revenue Break-even

52
$15,110

Assumptions:
Average Per-Unit Revenue
Average Per-Unit Variable Cost
Estimated Monthly Fixed Cost

$291.29
$70.00
$11,479

7.3 Projected Profit and Loss


The table below shows our projec ted profit and loss. There are two lines for direc t cost of sales
- the second line shows projec ted inventory costs of fulfilling our maintenance contrac ts. The
marketing/promotion line shows our planned advertising program expenses. Although these are
aggressive, we must spend heavily in the first year in order to establish the brand rec ognition
that will help us break in to the loc al market.
This table also shows our projec ted expense increases as we hire more employees and move into
a larger rented space. Before the move, the owner will absorb expenses related to utilities. In
years two and three, we have budgeted for additional expensed equipment to expand our
diagnostic and repair capabilities to keep up with orders.
We are seeking a modest net profit in the first year. As our reputation grows, we will see higher
revenues and net profit over the next three years.

Page 19

PC Repair

Page 20

PC Repair
Table: Profit and Loss
Pro Forma Profit and Loss
Sales
Direct Cost of Sales
Costs of Fulfilling Maintenance Contracts
Total Cost of Sales

FY 2006
$203,030
$42,604
$1,488
$44,092

FY 2007
$276,000
$55,800
$4,320
$60,120

FY 2008
$328,500
$64,350
$6,120
$70,470

Gross Margin
Gross Margin %

$158,938
78.28%

$215,880
78.22%

$258,030
78.55%

Expenses
Payroll
Marketing/Promotion
Depreciation
Lease

$69,000
$28,000
$0
$10,000

$110,000
$6,000
$0
$12,000

$115,000
$12,000
$0
$12,000

Expensed Equipment
Insurance
Website
Answering Service
Mileage
Vehicles
Cell Phones
Utilities
Internet
Moving Expenses

$0
$3,150
$2,080
$200
$2,660
$13,200
$1,260
$5,000
$1,200
$2,000

$10,000
$1,200
$480
$2,400
$5,400
$15,000
$1,260
$6,000
$1,200
$0

$12,000
$1,200
$480
$2,400
$5,400
$17,000
$1,260
$7,000
$1,200
$0

$137,750

$170,940

$186,940

$21,188
$21,188

$44,940
$44,940

$71,090
$71,090

$1,097
$6,027

$6,570
$11,511

$2,139
$20,685

$14,064
6.93%

$26,859
9.73%

$48,266
14.69%

Total Operating Expenses


Profit Before Interest and Taxes
EBITDA
Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales

Page 21

PC Repair

7.4 Projected Cash Flow


The Cash Flow chart, below, shows our projec ted cash position for the first year; the table
following it shows highlights for the first three years. With the requested start-up funding, we
will maintain a positive cash balance throughout, and repay the loan within three years.

Page 22

PC Repair

Page 23

PC Repair
Table: Cash Flow
Pro Forma Cash Flow
FY 2006

FY 2007

FY 2008

Cash from Operations


Cash Sales
Subtotal Cash from Operations

$203,030
$203,030

$276,000
$276,000

$328,500
$328,500

Additional Cash Received


Sales Tax, VAT, HST/GST Received
New Current Borrowing
New Other Liabilities (interest-free)
New Long-term Liabilities
Sales of Other Current Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received

$0
$0
$0
$0
$0
$0
$0
$203,030

$0
$0
$0
$0
$0
$0
$0
$276,000

$0
$0
$0
$0
$0
$0
$0
$328,500

FY 2006

FY 2007

FY 2008

Expenditures from Operations


Cash Spending
Bill Payments
Subtotal Spent on Operations

$69,000
$110,873
$179,873

$110,000
$141,877
$251,877

$115,000
$164,115
$279,115

Additional Cash Spent


Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current Borrowing
Other Liabilities Principal Repayment
Long-term Liabilities Principal Repayment
Purchase Other Current Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent

$0
$6,564
$0
$0
$0
$0
$0
$186,437

$0
$6,550
$0
$0
$0
$0
$0
$258,427

$0
$6,111
$0
$0
$0
$0
$0
$285,226

$16,593
$44,593

$17,573
$62,165

$43,274
$105,440

Cash Received

Expenditures

Net Cash Flow


Cash Balance

7.5 Business Ratios


Business ratios for the years of this plan are shown below. Industry profile ratios based on the
Standard Industrial Classification (SIC) code 7379, Computer Related Services, (NAICS 811212)
are shown for comparison.
Our projec ted growth is much higher than the industry average; in part, this is bec ause we are a
start-up, growing sales steadily in these first three years. We are sure that our sales forec ast is
conservative, given the dissatisfac tion among loc al computer users with existing options, and our
planned aggressive marketing campaign.

Page 24

PC Repair
Table: Ratios
Ratio Analysis
Sales Growth

FY 2006
0.00%

FY 2007
35.94%

FY 2008
19.02%

Industry Profile
5.23%

Percent of Total Assets


Inventory
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets

8.22%
16.81%
100.00%
0.00%
100.00%

8.15%
12.73%
100.00%
0.00%
100.00%

6.01%
8.14%
100.00%
0.00%
100.00%

2.79%
51.19%
75.09%
24.91%
100.00%

42.77%
0.00%
42.77%
57.23%

22.49%
0.00%
22.49%
77.51%

11.12%
0.00%
11.12%
88.88%

31.75%
18.48%
50.23%
49.77%

100.00%
78.28%
38.70%
0.00%
10.44%

100.00%
78.22%
65.72%
0.00%
16.28%

100.00%
78.55%
64.96%
0.00%
21.64%

100.00%
100.00%
80.06%
1.23%
1.95%

2.34
2.15
42.77%
59.02%
33.78%

4.45
4.08
22.49%
63.01%
48.84%

8.99
8.45
11.12%
63.16%
56.14%

1.53
1.24
57.27%
2.73%
6.39%

Additional Ratios

FY 2006

FY 2007

FY 2008

Net Profit Margin


Return on Equity

6.93%
41.32%

9.73%
44.10%

14.69%
44.21%

n.a
n.a

10.25
9.67
27
3.41

9.88
12.17
32
3.51

9.33
12.17
28
2.67

n.a
n.a
n.a
n.a

0.75
1.00

0.29
1.00

0.13
1.00

n.a
n.a

$34,039
19.32

$60,898
6.84

$109,163
33.24

n.a
n.a

0.29
43%
2.15
5.96
0.00

0.28
22%
4.08
4.53
0.00

0.37
11%
8.45
3.01
0.00

n.a
n.a
n.a
n.a
n.a

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth
Percent of Sales
Sales
Gross Margin
Selling, General & Administrative Expenses
Advertising Expenses
Profit Before Interest and Taxes
Main Ratios
Current
Quick
Total Debt to Total Assets
Pre-tax Return on Net Worth
Pre-tax Return on Assets

Activity Ratios
Inventory Turnover
Accounts Payable Turnover
Payment Days
Total Asset Turnover
Debt Ratios
Debt to Net Worth
Current Liab. to Liab.
Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total Assets
Acid Test
Sales/Net Worth
Dividend Payout

Page 25

PC Repair
7.6 Projected Balance Sheet
The Balance Sheet shows a steadily increasing net worth over the next three years. Since we
are planning to rent, and bec ause computer tec hnology changes so rapidly, we will have only
short-term assets, such as computer equipment and furniture. This will make our net worth much
more liquid than many similar businesses.

Table: Balance Sheet


Pro Forma Balance Sheet
FY 2006

FY 2007

FY 2008

Current Assets
Cash
Inventory
Other Current Assets
Total Current Assets

$44,593
$4,890
$10,000
$59,482

$62,165
$6,404
$10,000
$78,569

$105,440
$7,385
$10,000
$122,825

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets

$0
$0
$0
$59,482

$0
$0
$0
$78,569

$0
$0
$0
$122,825

Liabilities and Capital

FY 2006

FY 2007

FY 2008

Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$12,783
$12,661
$0
$25,444

$11,561
$6,111
$0
$17,672

$13,662
$0
$0
$13,662

Long-term Liabilities
Total Liabilities

$0
$25,444

$0
$17,672

$0
$13,662

Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital

$23,000
($3,025)
$14,064
$34,039
$59,482

$23,000
$11,039
$26,859
$60,898
$78,569

$23,000
$37,898
$48,266
$109,163
$122,825

Net Worth

$34,039

$60,898

$109,163

Assets

Page 26

Appendix
Table: Sales Forecast
Sales Forecast
Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Unit Sales
Home PC Unit

15

18

20

20

20

17

15

10

20

Small Business Unit


Promo
Maintenance Contracts

3
0
0

3
0
1

3
10
1

10
30
2

25
40
3

35
0
3

40
40
3

45
40
4

50
40
4

15
0
3

10
0
4

25
35
4

Total Unit Sales

17

57

86

58

103

109

111

33

24

84

Unit Prices

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Home PC Unit

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

$280.00

Small Business Unit


Promo

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

$500.00
$50.00

Maintenance Contracts

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

$400.00

Home PC Unit
Small Business Unit
Promo

$840
$1,500
$0

$1,400
$1,500
$0

$840
$1,500
$500

$4,200
$5,000
$1,500

$5,040
$12,500
$2,000

$5,600
$17,500
$0

$5,600
$20,000
$2,000

$5,600
$22,500
$2,000

$4,760
$25,000
$2,000

$4,200
$7,500
$0

$2,800
$5,000
$0

$5,600
$12,500
$1,750

Maintenance Contracts
Total Sales

$0
$2,340

$400
$3,300

$400
$3,240

$800
$11,500

$1,200
$20,740

$1,200
$24,300

$1,200
$28,800

$1,600
$31,700

$1,600
$33,360

$1,200
$12,900

$1,600
$9,400

$1,600
$21,450

Sales

Direct Unit Costs

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

30.00%
21.00%

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

$84.00
$105.00

8.00%

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

$4.00

12.00%

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

$0.00

Direct Cost of Sales


Home PC Unit
Small Business Unit

$252
$315

$420
$315

$252
$315

$1,260
$1,050

$1,512
$2,625

$1,680
$3,675

$1,680
$4,200

$1,680
$4,725

$1,428
$5,250

$1,260
$1,575

$840
$1,050

$1,680
$2,625

Promo
Maintenance Contracts
Subtotal Direct Cost of Sales

$0
$0
$567

$0
$0
$735

$40
$0
$607

$120
$0
$2,430

$160
$0
$4,297

$0
$0
$5,355

$160
$0
$6,040

$160
$0
$6,565

$160
$0
$6,838

$0
$0
$2,835

$0
$0
$1,890

$140
$0
$4,445

Home PC Unit
Small Business Unit
Promo
Maintenance Contracts

Page 1

Appendix
Table: Personnel
Personnel Plan
Owner
Tech1
Tech2

0%
0%
0%

Part Time
Total People

0%

Total Payroll

Feb
$2,000
$0
$0

Mar
$2,000
$0
$0

Apr
$2,500
$0
$0

May
$2,500
$2,400
$0

Jun
$3,000
$2,400
$0

Jul
$3,000
$2,400
$0

Aug
$3,000
$2,400
$2,400

Sep
$3,000
$2,400
$2,400

Oct
$3,000
$2,400
$2,400

Nov
$3,000
$2,400
$2,400

Dec
$3,000
$2,400
$2,400

Jan
$3,000
$2,400
$2,400

$0
1

$0
1

$0
1

$0
2

$0
2

$0
2

$0
3

$0
3

$0
3

$0
3

$0
3

$0
3

$2,000

$2,000

$2,500

$4,900

$5,400

$5,400

$7,800

$7,800

$7,800

$7,800

$7,800

$7,800

Page 2

Appendix
Table: General Assumptions
General Assumptions
Feb
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other

Mar
2

Apr
3

May
4

Jun
5

Jul
6

Aug
7

Sep
8

Oct
9

Nov
10

Dec
11

Jan
12

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

7.00%

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

10.00%
30.00%
0

Page 3

Appendix
Table: Profit and Loss
Pro Forma Profit and Loss
Feb
$2,340
$567

Mar
$3,300
$735

Apr
$3,240
$607

May
$11,500
$2,430

Jun
$20,740
$4,297

Jul
$24,300
$5,355

Aug
$28,800
$6,040

Sep
$31,700
$6,565

Oct
$33,360
$6,838

Nov
$12,900
$2,835

Dec
$9,400
$1,890

Jan
$21,450
$4,445

$0

$0

$48

$96

$144

$144

$144

$192

$192

$144

$192

$192

$567

$735

$655

$2,526

$4,441

$5,499

$6,184

$6,757

$7,030

$2,979

$2,082

$4,637

Gross Margin
Gross Margin %

$1,773
75.77%

$2,565
77.73%

$2,585
79.78%

$8,974
78.03%

$16,299
78.59%

$18,801
77.37%

$22,616
78.53%

$24,943
78.68%

$26,330
78.93%

$9,921
76.91%

$7,318
77.85%

$16,813
78.38%

Expenses
Payroll

$2,000

$2,000

$2,500

$4,900

$5,400

$5,400

$7,800

$7,800

$7,800

$7,800

$7,800

$7,800

Marketing/Promotion
Depreciation
Lease

$4,000
$0
$0

$1,000
$0
$0

$3,000
$0
$1,000

$2,000
$0
$1,000

$2,000
$0
$1,000

$3,000
$0
$1,000

$3,000
$0
$1,000

$2,000
$0
$1,000

$2,000
$0
$1,000

$2,000
$0
$1,000

$2,000
$0
$1,000

$2,000
$0
$1,000

Expensed Equipment
Insurance
Website

$0
$150
$40

$0
$0
$40

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

$0
$300
$200

Answering Service
Mileage
Vehicles

$200
$80
$0

$0
$85
$0

$0
$95
$6,000

$0
$100
$800

$0
$200
$800

$0
$300
$800

$0
$300
$800

$0
$300
$800

$0
$300
$800

$0
$300
$800

$0
$300
$800

$0
$300
$800

$0
$0
$0

$60
$0
$0

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$120
$500
$120

$0

$0

$2,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$6,470

$3,185

$15,835

$10,040

$10,640

$11,740

$14,140

$13,140

$13,140

$13,140

$13,140

$13,140

($4,697)
($4,697)

($620)
($620)

($13,250)
($13,250)

($1,066)
($1,066)

$5,659
$5,659

$7,061
$7,061

$8,476
$8,476

$11,803
$11,803

$13,190
$13,190

($3,219)
($3,219)

($5,822)
($5,822)

$3,673
$3,673

$109
($1,442)

$106
($218)

$103
($4,006)

$99
($350)

$96
$1,669

$93
$2,090

$90
$2,516

$87
$3,515

$83
$3,932

$80
($990)

$77
($1,770)

$74
$1,080

($3,364)
-143.77%

($508)
-15.39%

($9,347)
-288.48%

($816)
-7.09%

$3,894
18.78%

$4,878
20.07%

$5,870
20.38%

$8,201
25.87%

$9,175
27.50%

($2,309)
-17.90%

($4,129)
-43.93%

$2,519
11.75%

Sales
Direct Cost of Sales
Costs of Fulfilling Maintenance
Contracts
Total Cost of Sales

Cell Phones
Utilities
Internet
Moving Expenses
Total Operating Expenses
Profit Before Interest and Taxes
EBITDA
Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales

15%

Page 4

Appendix
Table: Cash Flow
Pro Forma Cash Flow
Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

$2,340
$2,340

$3,300
$3,300

$3,240
$3,240

$11,500
$11,500

$20,740
$20,740

$24,300
$24,300

$28,800
$28,800

$31,700
$31,700

$33,360
$33,360

$12,900
$12,900

$9,400
$9,400

$21,450
$21,450

Cash Received
Cash from Operations
Cash Sales
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

New Current Borrowing

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

New Other Liabilities (interest-free)


New Long-term Liabilities

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

Sales of Other Current Assets


Sales of Long-term Assets
New Investment Received

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$2,340

$3,300

$3,240

$11,500

$20,740

$24,300

$28,800

$31,700

$33,360

$12,900

$9,400

$21,450

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

$2,000

$2,000

$2,500

$4,900

$5,400

$5,400

$7,800

$7,800

$7,800

$7,800

$7,800

$7,800

$105

$3,102

$2,353

$10,424

$8,954

$13,556

$15,209

$15,896

$16,290

$16,282

$4,550

$4,152

$2,105

$5,102

$4,853

$15,324

$14,354

$18,956

$23,009

$23,696

$24,090

$24,082

$12,350

$11,952

Sales Tax, VAT, HST/GST Paid Out


Principal Repayment of Current Borrowing

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

$0
$547

Other Liabilities Principal Repayment


Long-term Liabilities Principal Repayment
Purchase Other Current Assets

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$0

$0
$0
$2,652

$0
$0
$5,649

$0
$0
$5,400

$0
$0
$15,871

$0
$0
$14,901

$0
$0
$19,503

$0
$0
$23,556

$0
$0
$24,243

$0
$0
$24,637

$0
$0
$24,629

$0
$0
$12,897

$0
$0
$12,499

($312)
$27,688

($2,349)
$25,340

($2,160)
$23,179

($4,371)
$18,809

$5,839
$24,647

$4,797
$29,444

$5,244
$34,688

$7,457
$42,145

$8,723
$50,868

($11,729)
$39,139

($3,497)
$35,642

$8,951
$44,593

Subtotal Cash Received


Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations

0.00%

Additional Cash Spent

Purchase Long-term Assets


Dividends
Subtotal Cash Spent
Net Cash Flow
Cash Balance

Page 5

Appendix
Table: Balance Sheet
Pro Forma Balance Sheet
Assets

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Starting Balances

Current Assets
Cash
Inventory

$28,000
$1,200

$27,688
$633

$25,340
$898

$23,179
$1,291

$18,809
$2,673

$24,647
$4,727

$29,444
$5,891

$34,688
$6,644

$42,145
$7,222

$50,868
$7,522

$39,139
$4,687

$35,642
$2,797

$44,593
$4,890

Other Current Assets


Total Current Assets

$10,000
$39,200

$10,000
$38,321

$10,000
$36,238

$10,000
$34,470

$10,000
$31,482

$10,000
$39,374

$10,000
$45,335

$10,000
$51,332

$10,000
$59,366

$10,000
$68,390

$10,000
$53,826

$10,000
$48,439

$10,000
$59,482

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$39,200

$0
$38,321

$0
$36,238

$0
$34,470

$0
$31,482

$0
$39,374

$0
$45,335

$0
$51,332

$0
$59,366

$0
$68,390

$0
$53,826

$0
$48,439

$0
$59,482

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital
Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities

$0
$19,225
$0

$3,033
$18,678
$0

$2,004
$18,131
$0

$10,130
$17,584
$0

$8,505
$17,037
$0

$13,050
$16,490
$0

$14,680
$15,943
$0

$15,354
$15,396
$0

$15,733
$14,849
$0

$16,130
$14,302
$0

$4,422
$13,755
$0

$3,711
$13,208
$0

$12,783
$12,661
$0

Subtotal Current Liabilities

$19,225

$21,711

$20,135

$27,714

$25,542

$29,540

$30,623

$30,750

$30,582

$30,432

$18,177

$16,919

$25,444

Long-term Liabilities
Total Liabilities

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$19,225

$21,711

$20,135

$27,714

$25,542

$29,540

$30,623

$30,750

$30,582

$30,432

$18,177

$16,919

$25,444

Paid-in Capital

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

$23,000

Retained Earnings
Earnings
Total Capital

($3,025)
$0
$19,975

($3,025)
($3,364)
$16,611

($3,025)
($3,872)
$16,103

($3,025)
($13,219)
$6,756

($3,025)
($14,035)
$5,940

($3,025)
($10,141)
$9,834

($3,025)
($5,263)
$14,712

($3,025)
$607
$20,582

($3,025)
$8,809
$28,784

($3,025)
$17,983
$37,958

($3,025)
$15,674
$35,649

($3,025)
$11,544
$31,519

($3,025)
$14,064
$34,039

Total Liabilities and Capital

$39,200

$38,321

$36,238

$34,470

$31,482

$39,374

$45,335

$51,332

$59,366

$68,390

$53,826

$48,439

$59,482

Net Worth

$19,975

$16,611

$16,103

$6,756

$5,940

$9,834

$14,712

$20,582

$28,784

$37,958

$35,649

$31,519

$34,039

Page 6